As 2023 winds down, once again, we’ll begin to spin the year-ahead prediction wheel at QSR. Expect a lot of tech thoughts and debates on price, labor (price and labor in tandem), and the endless battle that is trying to get ahead of the next (insert category) wars in quick service. On the doorstep of Thanksgiving, we’ll begin with Steve Schulze, cofounder and CEO of Nekter Juice Bar, who took a few minutes to share his thoughts on 2024 with QSR.
What lays ahead for the restaurant industry as a whole in 2024?
After explosive growth following the pandemic, most restaurants began to see some pushback in 2023 but this was not universal. In 2024, we will likely see the fast casual and the health and wellness segments continue to take a larger segment of the restaurant market overall. Fine dining will also see growth as food prices finally stabilize, however growth will be more realistic. We will not see double-digit comps but instead a return to comps in the 3 percent range. Finally, you will see an increase in subscription-based models in all segments from quick service to fine dining.
Finally, inflation combined with labor costs are increasing at an exponential rate. You will see initial pushback in pricing from guests however in time they will adapt.
What will we see in 2024 in regard to the juice bar category and Nekter in particular?
People are more conscious of their health than ever, and with that, becoming more educated what they put in their bodies. Consumers increasingly understand the power of nutrients and nutrient synergy and look to health-forward concepts such as Nekter Juice Bar, Sweetgreen, and CAVA to provide their daily nutritional essentials.
How do you see franchising in general changing (or not) in 2024?
Overall franchise sales and openings will be steady; however, the cost of funds will keep growth at a moderate pace through the mid-2024 with an increase in the second half of the year. As we are beginning to see the economy stabilizing and consumer confidence increasing, we can expect to see franchise sales grow across all segments.
What will happen with food prices and supply chain and how will that impact the industry and Nekter? What will Nekter do to overcome these challenges?
Years ago, when the airlines first implemented luggage fees and more recently moved to charge extra for specific seats, there was outrage. Yet the outrage softened, and it became the new normal. This is something that the entire restaurant space is confronting. While there will be modifications and cost offsets, a majority of these increases will be passed onto the consumer, and it will eventually become the new normal.
How will technology change/improve in 2024?
As we see more integration in technology through APIs, mergers, and acquisitions, we are moving toward an Amazon and Apple-like guest experience where all you have to do is walk into a restaurant and a screen will automatically pull up your favorite order, suggest customized offers, add-ons, and even new items or modifications based on your personal preferences and dietary needs. This will be combined with a one-button checkout experience using stored payment details.
AI is already playing a significant role in how restaurants operate, and this will only magnify. We will see more customization of individualized and targeted offers and apps will offer blended functions. Additionally, the integration of kiosks will continue to grow allowing for less labor, however with that comes less customer satisfaction. So, it is vital to balance convenience and speed of service without alienating guests.
How will/should marketing evolve in 2024?
We can expect to see more dollars allocated to influencers and content creators perhaps more than any other marketing segment. If you pay attention to what Todd Graves and Raising Cane’s is doing, you can’t help but find your own niche in influencer marketing and dramatically shift and increase your spend.
